What is the current market value of one of these bonds

Assignment Help Finance Basics

Reference no: EM13268141

Maryland Department of Transportation has issued 25-year bonds that make semiannual coupon payments at a rate of 9.93 percent. The current market rate for similar securities is 10.79 percent

a. What is the current market value of one of these bonds

b. What will be the bond's price if rates in the market (i) decrease to 8.79 percent or (ii) increase to 12.79 percent

c. How do the interest rate changes affect premium bonds and discount bonds. Bonds, in general, pixel.gif (increase/decrease)? in price when interest rates go up. When interest rates decrease, bond prices pixel.gif (increase/decrease)?

d. Suppose the bond were to mature in 12 years. What will be the bond's price if rates in the market (i) decrease to 8.79 percent or (ii) increase to 12.79 percent.

Reference no: EM13268141

Questions Cloud

Write down the formula for mean : The temperatre result in each measurement are listed below, write down the formula for mean and calculate the temperature mean value

What should be the market price of moriband stock : If investors in stocks of companies like Moriband require a rate of return of 17 percent, what should be the market price of Moriband stock?

Compute the present value of these dividends : Fresno Corp. is a fast-growing company that expects to grow at a rate of 21 percent over the next two years and then to slow to a growth rate of 16 percent for the following three years. If the last dividend paid by the company was $2.15.

Discuss the style of music played : Discuss the style of music played, e.g. jazz, metal, flamenco - describe the guitars and other equipment

What is the current market value of one of these bonds : Suppose the bond were to mature in 12 years. What will be the bond's price if rates in the market (i) decrease to 8.79 percent or (ii) increase to 12.79 percent.

Find the magnitude of the lift force acting on the plane : A jet airplane is in level flight. The mass of the airplane is m = 8830 kg. find the magnitude of the lift force acting on the plane

Obtain the average induced emf in the coil : A fixed 17.3-cm-diameter wire coil is perpendicular to a magnetic field 0.49T pointing up. In 0.15s , the field is changed to 0.33T pointing down. obtain the average induced emf in the coil

Determine the refractive power of a meniscus lens : A meniscus lens is concave on one side and convex on the other. Find the refractive power of a meniscus lens with n = 1.56 and curvature radius 29cm on the convex side and 48cm on the concave side

Community economic development : Desire to enter the program "Community Economic Development" from your point pf view. You can search and read more about this major.

User Account

All Pages